By Sean C. Castrina, author of “8 Unbreakable Rules For Business Start-Up Success“
Do any of these scenarios hit home?
• A lot of pink slips have been showing up within your company recently. And you’re afraid one of the next ones will land on your desk.
• You’re struggling to make ends meet as you work your way through school (or you’re waking up in cold sweats as you imagine the bills you’ll be getting once your children hit college campuses).
• Your daughter is planning a wedding that you’ll be financing.
• Or finally, after decades on the nine-to-five treadmill, you’re ready to retire — but a little worried about how far your bank account will stretch.
In any of these scenarios, you might find yourself thinking, Gee, it would be nice to start that business I’ve always dreamed about. Then I’d feel like I have more control over not just my finances but my life right now! If you’re like most people, though, that wish is followed by a “but”: But right now, I should save every cent I have instead of investing it in a business that may or may not succeed. But starting a business is really stressful, and I already have enough on my plate. But it’s too risky. But I don’t have enough time. And so on and so forth.
Well, hold up because I have another “but” for you.
All of these justifications for not wanting to become an entrepreneur at an uncertain time in your life are sound, but if you’re smart about it, these milestones can be the perfect time to start your own business. When you follow a specific set of rules, there’s less risk involved than you might think.
Service businesses require minimal money to start. In fact, I’ve never started a service business with more than $10k, and many with less than $3k — including businesses that have made me millions! Plus, many service businesses don’t require a prior work history in the field or particular qualifications, so you can get one off the ground fairly quickly.
Best of all, since you can hire others to perform the actual work while you handle the key behind-the-scenes management tasks (like hiring, supervising, taking client calls, marketing, etc.), service businesses are a great source of passive income. For instance, I started a mobile car detailing business in my 20s. I hired an employee to do the work, charged $95 for a full detail inside and out, and gave my worker 50 percent. All I did was make the phone ring and schedule the jobs. I didn’t get rich, but I did make an extra $25k a year — not bad for three to five hours of work a week during my down time!
Here are five major life events that, despite what you might think, are actually great times to start a business:
#1: In the midst of the college crunch.
Nothing can prepare a student better for the real world than starting and operating a business. And a college town is full of opportunities for starting a service business: tutoring, sports specialty training, babysitting services, home cleaning companies, and more. To start, you can do some of the work yourself and enlist fellow cash-strapped students to help.
I will never forget how broke I was going through college, or all the terrible jobs I did to stay solvent. I wish I’d known then what I know now about entrepreneurship. Then I wouldn’t have fallen asleep in my 9 a.m. literature class because I’d been working all night in a convenience store… and I definitely wouldn’t have had to clean toilets in the gym following athletic events, a job that still gives me horrifying visions to this day!
#2: Before you get downsized.
I’m often sought out by individuals who have just lost their jobs (often after working at the same organization for years, or even decades), asking how they can start over as business owners.
At this point, though — after the pink slips have already been handed out — people are at their lowest. Their self-esteem and motivation are shot, and their financial reserves are being diminished because they have no other income. That’s not a good place for a prospective business owner to be in! Instead, start your business when the downsizing rumors are just starting — or even better, when business is still good!
#3: Three years before your first child moves into a dorm.
If you’re like many parents, you’ve been worrying about the rising cost of college tuition since your child graduated from preschool. Take a deep breath: As long as furnishing a dorm room isn’t imminent, you’ll be fine. After years of teaching others to start their own companies, it’s very rare for a new service business not to be profiting within a year. And by year three, those businesses are normally rolling along quite well.
For me, ‘rolling along quite well’ means earning a minimum of $3k per month, passively. Again, a passive business is one in which you’re in a management role, not spending your own time and money performing the service you offer. You can keep your day job while funding your child’s education on the side. After all, most states offer many great educational options for less than the $3k per month your new business will be generating!
#4: When wedding bells are in the air.
Traditionally, brides’ parents have been expected to pay for their daughters’ weddings. According to The New York Times, though, this division of expenses has largely fallen by the wayside. Both families, as well as the couple themselves, are now chipping in. So whether you have a son or a daughter headed to the altar (or will be planning a wedding for yourself!), it’s a good idea to allow a small business to foot the bill.
Again, I’m going on the confidence that a well-run small business based on a profitable idea will bring its owner a minimum of $3k per month within a few years. That ‘special someone’ may not have entered your child’s life yet, but if he or she is ready for a relationship, why not start saving for an eventual wedding?
#5: When retirement is on the horizon.
You may be looking forward to retirement because finally you’ll have no boss breathing down your neck and no set schedule. You’ll be free to travel, pursue your hobbies, sleep in, and more. But before you know it, you might miss feeling challenged and purposeful. Moreover, you might be constrained by a tighter-than-anticipated budget. The solution: Start a business while you’re still at work and carry on running it (all part-time!) after you say “see ya!” to your old job.
Once again, it’s best if you can get the small business ball rolling three years from your walk-away date. But what if you’re planning on moving somewhere new to spend your retirement? In that case, I recommend living off of your retirement income, whether it’s a pension, savings, and/or Social Security, until you can set something up in your new location. Even before you move, you can start researching your future home to see what types of services might be needed there. With the right preparation, you can use your natural strengths and passions, never work more than 20 hours per week, and enjoy the retirement you’ve always dreamed about.
Believe me, I know that the idea of becoming an entrepreneur is intimidating — especially if something big is looming in your life. But if you’re smart about it, set up a business that fills a need in your area, and follow a specific set of rules, your company can be the solution to your problem instead of causing you more stress. So stop procrastinating. There’s no time like the present to start becoming your own boss!
Sean C. Castrina is the author of “8 Unbreakable Rules For Business Start-Up Success“ and the soon-to-be-released 8 Unbreakable Rules for Small Business Dominance. He is also founder of newbizcoach.org. A successful business coach and a true entrepreneur, he has started over 15 successful companies over the last 18 years. His companies have ranged from retail, direct mail marketing, and advertising to real estate development and home services.